Canadian transmission pipelines have been safely delivering the energy that Canadians use every day for a long time. In fact, over the last ten years the industry has a 99.999 per cent safe delivery record – and we’re working hard to get to 100 per cent.
But spills still happen occasionally; and when they do, the pipeline operator and industry are responsible for ALL clean up and recovery efforts. It’s called the Polluter Pays principle and it’s law under the Pipeline Safety Act, which came into force in June 2016.
You, the Canadian taxpayer, do not have to pay a dime. So, how does Polluter Pays actually work? Here are some of the key points.
CEPA members are sophisticated and well-capitalized corporations, and take spill response, recovery and remediation very seriously. These companies know their pipelines inside and out – and are ready to respond if a spill does happen.
All CEPA members have emergency response plans in place as well as technical and financial resources to respond to any incident. In addition, member company employees have built relationships with first responders who would also respond to incidents, including running through the emergency plans and test exercises with them. Above all, member companies are committed to responding effectively and to restoring the environment if there is a spill.
Adherence to extensive federal and provincial regulation assures pipelines are operated safely. Both the NEB and provincial regulators review and audit operators’ emergency response plans and require companies to conduct regular inspections on their pipelines.
All CEPA members have insurance to cover the costs if an incident does occur. They also have the financial capacity to pay further costs up front, if needed.
The absolute financial liability that falls on industry for the costs associated with a spill is instilled in law under the Pipeline Safety Act. In the unlikely event that a company can’t pay all the costs associated with a spill, other members of the industry are required to pitch in.
The National Energy Board (NEB) can also access money from an industry-pooled fund and from a Consolidated Revenue Fund to cover expenses. If the Consolidated Revenue Fund is used, money is then recovered from industry, with no financial burden passed on to taxpayers.
The Pipeline Safety Act assures Canadians that companies will financially and physically clean up all spills. Regardless of who or what is at fault, pipeline companies pay the entire cost up to $1 billion with no questions asked. You can learn more about the concept of absolute liability on this NEB page.
Transmission pipeline spills are very, very rare. When they happen, we jump into action. And cover every dollar of the cost. That’s part of our commitment to delivering the energy to Canadians in the safest and most responsible way.